Los Angeles moves to cut employee pensions

Amid boos and shouts from angry city workers, the Los Angeles City Council voted to approve sweeping pension cuts for all new civilian employees. The changes raise the full retirement age to 65 for new hires, eliminate city-funded healthcare for spouses of retired workers and cut pensions by as much as two-thirds, according to the Los Angeles Times.

The measures only apply to newly hired civilian workers, exempting police officers, firefighters and Department of Water and Power employees. The council must take a second vote within 30 days for the changes to go into effect.

Mayor Antonio Villaraigosa and local business leaders said the changes were needed to avert financial catastrophe from rising pension costs. Labor union leaders said the city could costs in other ways — such as ending double dipping by some City Council members — and charge that the council vote violated collective bargaining rules. They have threatened a lawsuit.

The pension changes in Los Angeles are similar to those enacted by other state and local governments, essentially setting up a two-tiered retirement system with different rules for current and new employees. In Los Angeles, for example, new employees’ take-home pay could be reduced in years when their retirement fund takes a hit in the stock market.

In recent years, public employees have seen dramatic changes in retirement benefits in many local governments, from states such as California and Rhode Island, to cities like San Jose and San Diego, Calif. The most common changes include raising the retirement age, limiting annual payouts and increasing employee contributions to pensions and health care.

You are both wrong. Public sector pensions have essentially gotten out of control. There is no reason why a municipal governmentt cannot decide to reduce pensions for future workers. It is within a municipality's legal power to do so. Current workers are protected, and their contracts rights are unimpaired. They have no standing to complain about the benefits available to future hires and they should shut their mouths instead of threatening frivolous lawsuits. It just goes to show how greedy and self-interested unions are.

First of all, Water and Power employees are NOT paid by taxpayer dollars. Many of these technical positions require highly skilled people with degrees. The Water and Power department must compete with private companies like PG&E for these workers. Pay and benefits must be competitive.

The quality and experience of government employees will be decimated as new employees numbers grow over the forthcoming years. No one will want to work for the government. There are no stock options. There are no bonuses. There is no profit sharing. There are no raises whenever the boss feels like it. You have a much lower pension. No retiree health care for spouse.

The very idea of cut or elimated pensions will scare future prospective employees away from government jobs at a time when governement entities should be looking to replace the "graying ones". Essential services will either suffer or be contracted out. Sorry, but from what I've seen so far, contracting out services creates a second rate environment. Perhaps that is what is sought in the long run. America in the future will not even closely resemble what we have today. And so another sector of the American workforce has to take it on the chin so those at the top can remain at the top. If pensions must be cut, at least include the elected officials as well. What on earth are we working for if you can't count on even a small pension? Social security? Better start lining up a place under a bridge to live at now before someone else does.

I have no pension on my job and pensions no longer exist in the 'real' world.
So government is doing so well now? Doing such great jobs?
Last I checked, there are millions unemployed. These jobs- with more REALISTIC benefits- will go quickly and there will be COMPETITION for them. Too much , in fact.

This is called divide and conquer. DWP will cover up its pension problem by increasing its rates (another name for taxpayer dollars). DWP is not the only workforce in the city that requires degrees/specialized training/technical expertise. A major problem is that when the economy was humming a few years ago, there was a "pension holiday" that local politicians agreed to so that regular pension payments were not made. Then the economy took a nosedive which as everyone know affected pension funds. Couple that with new GASB reporting guidelines so that this information could no longer be hidden. the overwhelming majority of general funded pensioners live on a modest income.

I don't wish to play devil's advocate, but I believe for now that outsourcing certain services will not only become essential but may be an improvement. The basic principle of competitive markets may improve some services provided and keep prices from either rising drastically or at all. Studies have demonstrated that municipalities have saved money by outsourcing certain services. In addition, if companies don't meet and exceed specified performance measurements then they can and should be replaced by someone else, hence service provision. In conclusion, allow citizens to take an active role in the decision making process for which services should be considered and would benefit the everyone from outsourcing.